Sports companies being compelled to adapt their supply chains due to Trump's tariffs
In a dynamic global environment, companies in the sporting goods sector are feeling the effects of ever-changing tariff policies. According to Houlihan Lokey's Consumer Group, represented by Thomas Egli, this industry is being forced to be more flexible due to geopolitical developments and evolving trade dynamics.
Their recent report, titled "Fit for the Future," suggests that these developments are prompting companies to reevaluate their global strategies. Eighty-four percent of surveyed executives are closely monitoring political shifts and proactively preparing for potential changes in cost structures and supply chain complexity.
One of the key areas of focus is tariffs. For instance, the cost of a football shirt includes tariffs on its export cost. The moves by President Trump have impacted the share price of major firms in the sporting space, but the "Fit for the Future" report does not specify any particular impact on these share prices.
However, the report does emphasise that tariff uncertainty is encouraging brands to rethink sourcing, explore local production, and accelerate automation. These efforts aim to strengthen resilience and unlock new efficiencies in a rapidly evolving trade environment.
Notably, UK sportswear and equipment companies like Pentland Brands (owner of Speedo, Canterbury), JD Sports, and ASICS UK have actively sought greater flexibility by diversifying their production sources, exploring local manufacturing options, and investing in automation. These strategies are designed to mitigate cost, margin, and operational risks in a dynamic global environment.
Leading brands in the sporting goods industry are taking a proactive approach by diversifying sourcing, exploring local production, and investing in automation to increase resilience. Anchoring a brand to a clear purpose becomes increasingly important as brands expand into new categories and price tiers.
Meanwhile, the United Kingdom has secured favourable tariffs with close geographical partners like the European Union, but these tariffs are higher than before President Trump's presidency. US import costs for merchandise made in high tariff countries are being passed on to the consumer.
As global trade dynamics continue to shift, brands that combine operational flexibility with thoughtful brand stewardship will be best positioned to protect value and sustain growth in a fast-changing and unpredictable market. This week, Prime Minister Keir Starmer and King Charles III welcomed President Donald Trump on an unprecedented second State visit, offering a platform for further discussions on these evolving trade relations.
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